As cross-border businesses and exchanges of people have expanded, international tax issues became more important and critical than ever before. We provide various international tax services in fields of transfer pricing, permanent establishment, cross-border M&A related corporate tax, individual income tax filing and foreign tax credits.
Transfer Pricing Advisory Services (Preparation of Local File)
To manage the transfer pricing issues, it is important to understand the inherent risk of its Chinese subsidiary and document the findings in a local file. The Chinese transfer price regulation states that if a company has tangible transactions with related parties for more than 200 million yuan, or intangible transactions and service transactions with related parties for more than 40 million yuan, or if a company operating with limited functional risk (i.e. a contract manufacturer) suffer losses, these companies are required to prepare transfer pricing local file.
Tax Risk Control and Mitigation
The business operating environment in China is changing every day. Until now, the business development model of a foreign company was to dispatch a large number of executives to subsidiary’s higher positions to carry out the same management model as the headquarters. However, in a business environment where COVID-19 restricts the flow of people, we need to transit from the traditional management model to train capable local human resources to achieve the localized business management.
General Advisory for International Taxation
Due to the uncertainty of interpretation of Chinese tax regulations, the tax practice in China requires flexible response. It is necessary to provide rational explanation to the overseas headquarters while corresponding to any relevant tax issues with the tax authorities.
